Post-pandemic Demand for Apartments and Single Family Rentals Looks Robust
October 26, 2020 | Calvin Schnure | Nareit
The pandemic has impacted nearly every part of the economy, including commercial real estate and REITs. Many sectors have seen a shift from in-person transactions to a digital economy; for example, as e-commerce replaces in-store shopping and web conferences supplant office meetings and business travel.
Demand for apartments looks to be robust post-pandemic, however, as there is one feature of housing that makes it different from retail, office, or hotels: one cannot live and sleep online. There may well be changes, however, in the demand for different types of housing, including apartments, single-family homes (owner-occupied and for rent), and manufactured housing. In particular, the potential longer-term effects of the pandemic can be grouped into three categories:
• Geographic changes, if work-from-home (WFH) shifts demand from the urban core and close-in suburbs to locations farther out within the same city, or in a lower-cost city;
• Shifts in demand from one type of unit to another , if a need for more space prompts moves from apartment living to single family home (owner or rental), or to manufactured homes; and
• Changes within a living unit to accommodate the needs during the day from a person or people who are working or studying from home.
